Is Texas Investigating Big Pharma (Again)?

Two doctors at the Terrell State Hospital, one of ten state-run psychiatric hospitals, resigned last week amid allegations they took money from a pharmaceutical giant in exchange for hawking the drug maker's anti-psychotic to state regulators. Records from the Department of State Health Services indicate that an investigation by the state Attorney General's Office triggered the disciplinary action.

And if that's the case (the AG's office won't talk about the investigation) it wouldn't be the first time Texas officials have targeted Big Pharma for surreptitiously pushing to expand the use of anti-psychotics in the state's publicly-funded health care system.

DSHS sent letters accusing the two doctors -- Anthony Claxton, Terrell's clinical director, and Lisa Perdue, a psychiatrist at the hospital -- of pocketing tens of thousands of dollars in speaking fees and travel reimbursements from the London-based drug maker AstraZeneca. In return, DSHS alleges, Claxton and Perdue approached members of a state committee that sets drug standards in Texas, the state Executive Formulary Committee, pushing the company's anti-psychotic drug Seroquel.

According to DSHS's warning letters, which were first obtained by the Texas Tribune last week, both doctors admitted to the allegations when questioned under oath during an AG inquiry into the matter. The nature of that investigation remains unclear -- a DSHS rep deferred our questions to the state AG's office, saying "the AG's office would need to speak to their own investigation," while an AG rep told us, "It's the policy of our office not to confirm or deny the existence of any possible investigations."

DSHS has accused Claxton of taking more than $231,000 from AstraZeneca for "promotional speaking and consulting services" between 2005 and 2012. State health officials claim that AstraZeneca used Claxton to promote Seroquel, a drug that's FDA-approved to treat schizophrenia and bipolar and major depressive disorders, and Seroquel XR (an extended release version of the drug) to state health officials because of Claxton's influential role within the system -- an apparent violation of rules that bar state health employees from taking money that could "influence the employee in the discharge of official duties." (According to ProPublica's "dollars for docs" database, which tracks Big Pharma payouts to doctors, another drug company, Eli Lily, paid Claxton as much as $164,000 between 2010 and 2013 in speaking and travel fees.)

According to DSHS's letter, Claxton admitted to touting the drug for AstraZeneca when questioned by the AG's office:

"In an examination under oath taken in conjunction with the Office of Attorney General's pursuit of this matter, you admitted that you know you were being utilized and paid by the pharmaceutical company to speak regarding the company's medication, Seroquel and Seroquel XR, because of your influence within DSHS, specifically, you admitted in sworn testimony that you understood that you were being approached by AstraZeneca to promote Seroquel XR to other state doctors because you are a state doctor and, therefore, had more credibility with that group than a non-state doctor."

According to DSHS, Perdue took some $615,000 from AstraZeneca between 2005 and 2013. In its warning letter to Perdue, DSHS claims the doctor was literally provided with AstraZeneca talking points to promote the drug to the state's formulary committee:

"In an examination under oath taken in conjunction with the Office of Attorney General's pursuit of this matter, you described your participation in a promotional plan by AstraZeneca to use your influence over Executive Formulary Committee (EFC) members and admitted that an AstraZeneca employee actually helped you type out AstraZeneca talking points to send along with your application to add Seroquel XR to the state hospital formulary. Additionally, you also agreed to a request by AstraZeneca to contact particular members of the EFC in person in order to use your position as a state employee on behalf of AstraZeneca and Seroquel XR and that when you made that requested contact with those EFC members, you identified your position with the state, but did not acknowledge that you received money from or was acting on behalf of AstraZeneca."

If DSHS's allegations prove true (see the responses from Claxton and Perdue's attorney here and here), the episode seems to fit a pattern we've seen from Big Pharma over the past decade.

Seroquel is among a new generation of anti-psychotic drugs, so-called "atypical" anti-psychotics that, while FDA-approved for narrow treatment, quickly became some of the drug industry's signature moneymakers. While AstraZeneca initially got FDA approval in the 1990s to treat adults experiencing manic episodes that accompany schizophrenia or bipolar disorder, lawsuits by the federal government and several states against the company have claimed that AstraZeneca for years manipulated information about Seroquel's serious side-effects and paid off doctors to tout the drug for non-FDA approved uses.

(While doctors can prescribe drugs for off-label uses, companies are strictly prohibited from marketing drugs for anything outside their FDA-approved use.)

With its huge Medicaid population encompassing prisons, psych hospitals and the foster care system, in the late 1990s Texas became a prime target for pharmaceutical companies fighting to make their new anti-psychotics preferred treatment for a variety of conditions. Johnson & Johnson, the first company to gain FDA approval for its atypical anti-psychotic Risperdal, blazed a trail in Texas that competitors like AstraZeneca eventually followed. Records unearthed in a lawsuit Texas filed against Johnson & Johnson subsidiary Janssen Pharmaceuticals show the company paid prominent psychiatrists at Duke, Cornell and Columbia universities half a million dollars to draft company-approved guidelines that eventually became the Texas Medication Algorithm Project, or TMAP, which bumped some atypicals up to first-choice treatment options.

(See also: Down the Hatch: The Texas Attorney General's Office says a drugmaker lied in order to push an antipsychotic on foster children. So why are kids as young as three still taking the drug?)

Records from that lawsuit, which Janssen settled with the state in 2012, show that some $1.3 million in drug-industry cash flooded TMAP and its architects, "key opinion leaders" like the then-director of the Texas Department of Mental Health and Mental Retardation and big shots at state-funded medical schools. AstraZeneca, according to court documents, donated $40,000 to the TMAP effort.

Drug giant Pfizer has fought lawsuits in Texas and elsewhere alleging a broad campaign to market its anti-psychotic drug Geodon for off-label purposes, particularly for use in children. In 2009, Pfizer paid $2.3 billion to make one such lawsuit brought by the federal government go away; it was the largest health care fraud settlement in history.

Texas was also among several states that joined two whistle-blower lawsuits against AstraZeneca over the company's marketing and sale of Seroquel. According to company emails that trickled out in those civil suits, AstraZeneca "buried" unfavorable studies of the drug; one email shows an AstraZeneca official praising a company physician for minimizing a study's adverse findings, telling the doctor "great 'smoke-and-mirrors' job!"

"From the 1997 launch of AstraZeneca's 'blockbuster' drug, AstraZeneca has surreptitiously promoted Seroquel for a myriad of off-label uses and off-label patient demographisc - particularly young children and the frail and infirm elderly - and has misled the FDA," states one of those lawsuits. In 2010, AstraZeneca agreed to pay $520 million to settle the lawsuits and end two federal investigations into the company's marketing practices.

We've asked AstraZeneca for a response to DSHS's allegations that the company paid two state hospital doctors to influence state drug guidelines. We'll update if we hear back.


UPDATE 4:00 p.m.: We just received this emailed statement from AstraZeneca responding to DSHS's allegations:

"We do not have comment on the specific resignations, however, I can tell you that AstraZeneca is committed to doing business with the highest ethical standards and respect for the law. AstraZeneca is committed to ensuring that our relationships with healthcare professionals are compliant and that the priorities of patient health and good medicine remain the cornerstones of these relationships.

AstraZeneca policies prohibit compensation for services as an inducement to, or any way in consideration of, a healthcare professional's current or potential prescribing, purchasing, use, formulary status, or dispensing of AstraZeneca products."

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Michael Barajas
Contact: Michael Barajas